Luxury Giant Kering Reports 12% Q4 Sales Decline, Gucci Falters
French luxury conglomerate Kering has posted a 12% decrease in fourth-quarter sales, primarily driven by underperformance from its flagship brand Gucci.
Gucci's sales slumped by 24%, falling short of analyst forecasts for a 19% decline. The brand's attempts to revitalize its aesthetic with a minimalist approach failed to resonate with consumers amidst an ongoing slowdown in global luxury demand.
Despite Gucci's struggles, Kering noted positive signs in major markets. Mainland China and the United States witnessed sequential sales improvements, particularly among Chinese shoppers.
Finance chief Armelle Poulou stated, "We saw a sequential improvement in our sales of 6 points between Q3 and Q4, an improvement that we also saw in Chinese nationality."
CEO Francois-Henri Pinault expressed confidence in the company's trajectory, saying, "We have reached a point of stabilization, from which we will gradually resume growth."
Full-year recurring income from operations surpassed Kering's October guidance, reaching 2.6 billion euros.